
“From a first-principles basis, global liquidity… drives risk assets,” Coutts opines, with the solemnity of a man who has seen the inner workings of the financial machine and lived to tell the tale. His analysis, built upon the foundations of central-bank balance sheets, global money supply, FX reserves, and the shadowy underbelly of commercial and shadow banking, reveals a connection so profound that one might almost call it a conspiracy. Yet, he warns, “Markets are non-stationary… The correlation itself is a moving target, so I wouldn’t get too tied up in charts where you’re fine-tuning the lag. That lag period will change all the time.”